How wear and tear can impact your insurance in South Africa

 ·12 Mar 2023

South Africans should take reasonable steps to maintain their insured objects, as insurance companies can reject claims due to lack of maintenance.

Jean-Paul Rudd from Adams and Adams said that insurance policies often contain clauses that require policyholders to take reasonable steps to maintain an insured object.

Rudd said that the reason is quite simple: insurance aims to protect policyholders from unforeseen circumstances, not to compensate them for poor maintenance, such as wear and tear.

A policyholder failing to maintain an insured object may thus result in a claim regarding damage being rejected by their insurer.

Policyholders should always be aware of their duty of maintenance and take the necessary steps to comply with it.

Rudd gave a few examples of how wear and tear issues can lead to a policyholder’s claims being rejected.

Firstly, a policyholder who is the owner of a unit in a sectional title complex may suffer water damage to their property due to a burst pipe adjacent to their unit. A body corporate may be insured for such damage, but the insurer can refuse to entertain a claim if the water pipe burst due to wear and tear.

Secondly, a logistics company may have one of its long-haul tricks damaged in an accident. The insurer may decline a claim if it is found that the truck’s braking system failed due to wear and tear.

Thirdly, an insurance policy may state that a holiday house has a working alarm system. If the battery system of the alarm failed due to wear and tear, the insurance company may reject the claim.

Rudd said that policyholders should always understand what is expected of them in terms of maintaining their insured objects. They should always seek clarity from their insurer/broker if what is expected of them remains unclear.

He also said that regular maintenance should be performed to prevent larger issues from happening in the future, with reputable and licensed contractors sourced. Receipts should also be kept as proof of the repairs.

Always read the fine print 

Rudd has previously warned that South Africans should always thoroughly read insurance contracts before signing off on them.

An insurance contract is a binding agreement between the insured and the insurer. He said that both have obligations to each other, and failing to comply with these obligations can see an insurer reject an insured’s claims.

For instance, an insurer can reject a claim based on the “reasonable precautions clause,” which is very common. This means that the insured must take appropriate measures to prevent foreseeable harm or damage. This is used to hold parties accountable when engaging in risky behaviour.

“It, therefore, pays to read and understand the fine print of an insurance contract,” he said.


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